At the beginning of this year, not many industry observers had expected mainland property firm Country Garden (02007.HK) to join the list of entities reaping 100 billion yuan (US$16.38 billion) in annual sales. But things have turned otherwise, as the developer has wowed the market with a 130 percent sales surge in the first eleven months.
With contracted sales of 96.7 billion yuan for the January-November period, the company is definitely on course to surpass the 100 billion yuan milestone this year. What lies behind this remarkable feat?
Riding the wave of a robust property market, Country Garden has stepped up sales promotion efforts during the year by providing more financial incentives. Commission now accounts for a greater portion of the salary packages of sales personnel, and senior manger’ rewards are also linked more closely with the company’s financial performance, the 21st Century Business Herald reported.
The company has also given more autonomy to regional subsidiaries to speed up land acquisition decisions and quicken the response time to market changes.
Contributions from outside its home turf of Guangdong province have increased to 45 percent of total sales in the first half of 2013, from a level of 24 percent in 2008, the Business Herald noted. Focusing on second- and lower-tier cities and suburban areas of big cities has always been the centerpiece of Country Garden’s game plan. The strategy helps keep land costs down and allows speedy development of sizable projects to support rapid sales expansion.
President Mo Bin told the Business Herald that the company will stick to this business model as the government pushes its urbanization plan.
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